Citi: Foreigners Are Way More Bullish About The U.S. Than Americans Are

Different populations of investors are perceiving stocks
completely differently right now, according to an interesting
analysis from Citi's Tobias Levkovich.

While fund flows for U.S. stock mutual funds and ETFs have been
negative according to Citi, (even though now less so than
before), U.S. corporates, insurance companies, and notably
foreigners have been buying up stocks:

Citi:

After having been burned by two 50%+ declines in the past decade,
US stock market investors are understandably concerned that
buying into equities is not the best of ideas. As such, money
flows continue to exit US-oriented mutual funds, while continuing
to buy into international equity funds as seen since the
beginning of September based on weekly data (see Figure 1). In
addition, ETF flows show a similar pattern (see Figure 2),
supporting the notion that investors see better opportunities
elsewhere.

...

In contrast, US corporations and foreigners seem to see
opportunity by buying into such pullbacks (see Figures 3 and 4),
arguing that different investor groups perceive different
realities.

It looks like a classic case of the grass being greener on the
other side.

The U.S. has many serious problems, but perhaps Americans forget
that it has an enormous amount of strengths other nations can
only dream of. One thing that you learn from traveling the world
is that every nation has serious long-term problems of one kind
or another. There are very few nations that don't have deep
fundamental problems in need of a solution, and while the U.S.
has its own, many other nations would gladly trade places in an
instant.